The $2.5 billion urea and ammonia fertilizer plant was commissioned by Nigeria’s President Muhammadu Buhari in Lagos, where Dangote is also slated to open a 650,000 barrel-per-day oil refinery later this year.
“People are asking us to sell,” he said.
“We are very selective about who we sell this product to. We’re loading a ship that’s going to the US, Brazil, Mexico, India… The EU is trying to buy from us,” he added.
The fertilizer plant is located on 500 hectares (1,235 acres) of land on the outskirts of Lagos and has the capacity to produce 3 million tons of urea annually, making it the second largest plant in the world, Dangote said.
The start comes at a critical time. The war in Ukraine has pushed up prices and caused global food shortages. Russia and Ukraine are major suppliers of urea, potash and phosphate, key components of fertilizers. The countries are also major global suppliers of wheat and other grains.
Urea and ammonia are essential ingredients for farmers to meet production targets, and access to fertilizers has been severely restricted, threatening the global food supply chain.
“We’re lucky to have this facility,” added Dangote. “The Ukraine-Russia conflict comes at a good time as both Ukraine and Russia control significant amounts of agricultural inputs… This can help many African countries. The export market is a seller’s market.”
The number of people on the brink of famine has risen to 44 million from 27 million in 2019, the United Nations World Food Program said this month. Parts of Africa could be plunged into starvation in as little as three months if Russia’s war in Ukraine drags on, says Wandile Sihlobo, chief economist at the Agricultural Business Chamber of South Africa.
“In the short term, between now and three months, the conflict will affect the food supply mainly from a price point of view,” Sihlobo told CNN.
Nigeria has been trying to diversify its economy away from oil for some time, and Dangote believes the plant could bring the country $5 billion in export earnings each year.
“This is a very big impact. It is very significant for Nigeria’s economy,” Dangote told CNN.
Central bank governor Godwin Emefiele said cutting fertilizer imports is a key pillar in Buhari’s diversification agenda, moving the country from a net importer of the commodity to being self-sufficient.
“In fact, over 35 million sacks of compound fertilizers have been produced in Nigeria in the last five years. As a result, not only has our fertilizer import bill dropped significantly, but we are also seeing increasing investment in the fertilizer industry, such as is being commissioned today by Dangote Group,” he said during a speech at the inauguration of the plant.
“Today Nigeria is self-sufficient in urea production and we are also the leading urea producer on the African continent.
At the event, Buhari said the facility will help Nigeria end its dependency on food imports.
“The plant creates tremendous opportunities in the areas of job creation, warehousing, transportation and logistics. This will create significant wealth, reduce poverty and help secure the future of our nation.”
Dangote Group is the second largest employer in Nigeria federal government.